August 12, 2013
Last week I reported on NFIB’s access to capital quarterly survey results.
This week another small business advocacy group, NSBA, released their 2013 Mid-Year Economic Report.
The takeaway? Main Street’s lack of capital stifles job creation.
“Using NSBA data from as far back as 1993, there is a clear correlation to a small-business owner’s ability to hire and his/her ability to get financing. While the last four years have seen a small-business community struggling to stay afloat, we also have seen their ability to get capital diminish. Today, just 65 percent of small businesses report they are able to obtain adequate financing, down from 73 percent just six months ago. This drop in capital availability is in line with slow employment growth both in the last 12 months as well as low projections for the coming 12 months.”
Here are some more stats from the NSBA survey;
This one surprises me. The average debt among the 88% of small businesses that do have debt is $835,828. That is significantly higher that I would have thought. Some larger, small businesses must have skewed the average. (36% of those surveyed had sales less than $500,000)
This stat doesn’t. SBA lending met 5% Main Street’s capital needs in the last 12 months.
Some more cool stats;
20% of NSBA members listed access to capital of one of their top three concerns.
69% say their businesses has been impacted by the credit-crunch
The effect on operations due to lack of access to capital:
Not a problem – 50%
Unable to expand – 36%
Unable to finance increased sales – 18%
Unable to increase inventory – 10%
Reduced benefits to employees – 14%
Closed stores or branches – 4%
If you are into stats, download the report here. If not, don’t worry, we’ll cover some more of the report in the coming days.